Austerity is a blight on recovery, say City bosses
Three quarters of City bosses believe the Government's austerity agenda is damaging the UK's hopes of recovery, according to new research.
A survey of some of the UK's leading chief executives of publicly listed organisations or venture capital-backed firms in industries including financial services, IT, pharmaceuticals, property and communications found three out of four chief executives said cost-cutting could not be seen as a route to growth.
The findings come as Chancellor George Osborne is under increasing pressure over his austerity plans, which he claims give the Bank of England room to keep interest rates low and stimulate the economy through printing money.
Mr Osborne's strategy faced criticism last week from Nobel Prize winning economist Paul Krugman. Bank of England rate-setters will debate whether to pump an extra £50 billion into the economy this week after an alarming plunge in activity for the UK's manufacturers in May.
Three quarters of business leaders who were asked to name the top enablers of growth said leadership was crucial, with only a quarter believing cost-cutting is a successful strategy.
"Four years ago, it was all about trimming budgets and curbing spending, but business leaders are now sending a clear message to the Government that UK Plc cannot cut its way to growth," said Campbell Macpherson, chief executive of corporate advisory firm Campbell Macpherson & Associates.
The sea change contrasts with a high-profile public letter endorsed by the bosses of 35 major companies, including the chief executives of Next and Mothercare, in October 2010 that claimed Mr Osborne's austerity measures "improve business and consumer confidence".
But official figures show the economy has been flat for the past 18 months. Further weakness is expected in the current quarter as Europe's debt crisis worsens and an extra day off for the Queen's Diamond Jubilee celebrations hits output.
- 1 BBC election debate: The one photo that summed up the whole 90-minute leaders debate
- 2 18th century sex toy found in 'toilet of sword fighting school' in Poland
- 3 US? China? India? The 10 biggest economies in 2030 will be...
- 4 'I wish my teacher knew...': Young students share their 'heartbreaking' worries in notes
- 5 Rebecca Francis accuses Ricky Gervais of using 'influence' to target female hunters after receiving barrage of death threats
General Election 2015: David Cameron catching up in polls – but he badly needs a clear lead
South Africa xenophobic attacks: Shops looted and violence on streets of Johannesburg as foreigners are forced to hide in police stations
18th century sex toy found in 'toilet of sword fighting school' in Poland
'I wish my teacher knew...': Young students share their 'heartbreaking' worries in notes
Rebecca Francis accuses Ricky Gervais of using 'influence' to target female hunters after receiving barrage of death threats
The only black face in the Ukip manifesto is on the page about overseas aid
If I’m being racially abused I don’t need a stranger with a saviour complex to rescue me
Ukip is the only main political party to not address LGBT rights in its manifesto
BBC election debate: The one photo that summed up the whole 90-minute leaders debate
Religion isn't growing, it is becoming vigorous in its demise, says philosopher AC Grayling
Food banks: One million Britons will soon be using them, according to Trussell Trust
iJobs Money & Business
£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...
£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...
£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...
£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...